Bitcoin, often hailed as a safe haven and a reliable store of value, faced a severe test of its resilience over the weekend as tensions escalated between Iran and Israel. This caused a sharp bitcoin price crash from $70,000 on April 12, to around $60,000 on April 18.
Critics seized upon this to argue that bitcoin had failed in its role as a safe haven asset, sparking renewed debates within the Bitcoin community regarding its efficacy during times of uncertainty. However, prominent Bitcoin advocate Anthony “Pomp” Pompliano, remained steadfast in his conviction, dismissing the weekend crash as inconsequential for long-term investors.
Bitcoin Price Crash to $64k: A ‘Dream’ Scenario
Speaking to CNBC, Pompliano characterized the dip to $64,000 as a “dream” scenario in previous years, emphasizing the remarkable gains bitcoin has achieved over the years.
The analyst rebuffed claims that Bitcoin had faltered as a safe haven, pointing out that during periods of financial or geopolitical uncertainty, investors typically flock to liquid assets like dollars, a trend witnessed during the COVID-19 pandemic.
Pompliano’s optimism extended to bitcoin’s recovery prospects, as he highlighted the inevitability of multiple 15% drops within any bull cycle. Despite market jitters, he expressed confidence that bitcoin would lead the rebound as global markets regain their footing.
During these geopolitical tensions, bitcoin was among the digital assets that experienced the least impact. Coinglass reported that while centralized exchanges saw over $757 million in long liquidations on Saturday, only $261 million was attributed to bitcoin positions.
Bitcoin vs. Gold
While Bitcoin faced scrutiny, gold emerged as a beacon of stability amid geopolitical tensions. Despite fears of a potential World War triggered by the Iran-Israel conflict, gold remained resilient, reaching a new all-time high of $2,430 per ounce before experiencing profit-taking and closing at $2,340 on the Friday.
When gold markets reopened on Monday, the precious metal surged by 1.8%, underscoring its enduring appeal as a safe-haven asset. However, Pompliano took side of the digital asset by stating:
“[Bitcoin] is up 800% since the last halving. While over the last 5 years, anyone holding gold has LOST purchasing power. Bitcoin is the superior savings technology.”
Bitcoin Dominance Soars
In the midst of bitcoin’s price drop, Mitchell Askew, head analyst at Bitcoin mining firm Blockware Solutions, expressed optimism regarding the upcoming Bitcoin halving event.
Anticipating a “buy the news” sentiment among both public Bitcoin miners and the private ASIC market, Askew’s confidence reflects a broader sentiment within the mining sector regarding the long-term prospects of Bitcoin.
Despite the weekend setback, bitcoin retained its position as a top performer within the overall digital asset market. Bitcoin’s dominance, representing its share of the total market cap, surged to 57% on Sunday, as per the data by TradingView.
This reversal in dominance reflects Bitcoin’s resilience amidst market turbulence, reaffirming its status as the dominant force in the digital asset sphere.
